Gold Heads for Sharpest Drop in Six Weeks on Rate Hike Expectations

The sharp rise in oil prices amid escalating geopolitical tensions between the US and Iran has reignited inflation concerns. This strengthens the likelihood of central banks raising interest rates, negatively impacting investors' demand for safe-haven assets. Gold prices have lost over approximately 3% on a weekly basis under the pressure of rising rate hike expectations. This decline marks gold's sharpest weekly loss in the last six weeks. Markets are closely monitoring both geopolitical risks and signals regarding monetary policy. The strengthening of rate hike expectations reduces the appeal of assets like gold, which yield no returns. Analysts note that gold prices may fluctuate in the short term depending on interest rate policies and geopolitical developments. However, under current conditions, the downward trend could persist. This is not investment advice.